On January 18-19, 2024, the China-US Financial Working Group held its third meeting in Beijing. In fact, in the past three months, this mechanism between China and the United States has basically maintained the rhythm of holding meetings once a month, which shows that the two countries have great cooperation in key areas such as monetary and financial stability. It has been noted that He Lifeng, Vice Premier of the State Council and Chinese leader of Sino-US economic and trade relations, met with the US delegation of the Sino-US Financial Working Group on the 19th, expressed China’s goodwill to the US and emphasized China’s position. Since the beginning of the year, the high-level interaction between China and the United States has continued and attracted much attention from the outside world.
He Lifeng, Vice Premier of the State Council and Chinese leader of Sino-US economic and trade relations, met with the US delegation of the Sino-US Financial Working Group in Beijing. Source: Xinhua News Agency
The third meeting of the China-US financial working group was held in Beijing, and the two sides agreed to continue to meet regularly.
The meeting of the China-US Financial Working Group was co-chaired by Xuan Changneng, Vice Governor of the People’s Bank of China, and Naiman, Assistant Treasury Secretary of the United States. The Ministry of Finance of China, the State Financial Supervision and Administration, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and the Federal Reserve, the US Securities and Exchange Commission and other relevant departments attended the meeting. Pan Gongsheng, Governor of China People’s Bank, attended the meeting and delivered a speech.
The China-US Financial Working Group is a financial exchange mechanism between the two countries established under the guidance of the leaders of China and the United States in order to implement the important consensus reached by the two heads of state in Bali. This is the third meeting of the China-US Financial Working Group since its establishment in September last year, the first meeting in 2024 and the first meeting held in China.
According to the Chinese press release, the two sides conducted professional, pragmatic, frank and constructive communication on issues such as monetary and financial stability, financial supervision, financial markets, cross-border payment and data, sustainable finance, anti-money laundering and anti-terrorist financing, global financial governance and other issues of major concern to both sides. The meeting also heard the report of the technical expert group on the stress test of banking climate risk and the disposal mechanism of their respective global systemically important banks (G-SIBs). At the end of the press release, it was specifically mentioned that the two sides agreed to continue to communicate.
The US Treasury Department mentioned in the press release released on the 19th that US officials "frankly raised areas of disagreement" during the meeting, but did not specify what the differences were. The article also emphasizes that the two sides agreed to continue to hold regular meetings.
Yang Shuiqing, an assistant researcher at the Institute of American Studies of China Academy of Social Sciences, said in an interview with Shenzhen Satellite TV’s direct news that the biggest highlight of the third meeting of the China-US Financial Working Group in Beijing was actually how to warn of this debt repayment pressure and financial risks during the economic downturn, because the press release emphasized that for global systemic banks, if risks occur, the two sides should communicate with each other. In November and December last year, the Federal Reserve frequently assessed whether there were some risks in its own banks, and worried about the impact of spillover risks on the United States. If there were certain financial risks in China, whether they would be transmitted to the United States, or whether they were dependent on each other, both sides should focus on it seriously. In addition, the next step will also focus on the free flow of cross-border data and cross-border payment.
He Lifeng (right) met with former US Treasury Secretary and Huaping Group Chairman Geithner (left) on 18th. Source: Xinhua News Agency
He Lifeng met with Yellen, the US delegation of the China-US Financial Working Group: I look forward to visiting China again
On January 19th, He Lifeng, Vice Premier of the State Council and Chinese leader of Sino-US economic and trade relations, met with the US delegation of the Sino-US Financial Working Group in Beijing. He said that China is willing to work with the US to implement the important consensus of the meeting between the two heads of state in San Francisco and promote the development of bilateral relations in a healthy, stable and sustainable direction. The two sides should continue to make good use of the financial working group mechanism, continuously accumulate achievements and consolidate the momentum of cooperation in the financial field.
The US delegation told He Lifeng that Finance Minister Yellen welcomed the progress made by the working group and discussed the importance of further deepening communication and cooperation between the two sides. They also said that Yellen looked forward to visiting China again at an appropriate time.
On July 8, last year, when Yellen visited China for the first time as US Treasury Secretary, she held talks with He Lifeng at the Diaoyutai State Guesthouse. It was also the first time that He Lifeng appeared as the "Chinese leader in Sino-US economic and trade" after he became the vice premier of the State Council. Before the first meeting between China and the United States in November last year, Yellen and He Lifeng had a two-day meeting in San Francisco in advance, which was also regarded by the outside world as their efforts to improve their relations and keep the dialogue channels open.
On July 8, 2023, US Treasury Secretary Janet Yellen (left) shook hands with Vice Premier He Lifeng (right) of the State Council, China, when they met at the Diaoyutai State Guesthouse. Source: Associated Press
After Yellen’s visit to China in July last year, China and the United States set up the China-US Financial and Economic Working Group two months later to maintain continuous contact and communication on substantive economic and financial policy issues. The two working groups reported directly to He Lifeng and Yellen respectively, and held their first meeting at the end of October last year. It is observed that financial work consultation is also one of the most frequent areas of high-level exchanges between China and the United States, which shows that both sides have urgent needs for cooperation.
In fact, this is not the first time Yellen has expressed her hope to visit China again. On December 14th, last year, when Yellen attended the celebration of the 50th anniversary of the founding of u.s.-china business council in Washington, DC, she mentioned that her first task in managing relations with China in 2024 included planning her second visit to China. In her dinner speech that day, she stressed that the United States does not want to "decouple" from China, and is trying to establish "lasting communication channels" so as to deal with problems in time.
According to Yang Shuiqing’s analysis of Shenzhen Satellite TV’s direct news, objectively speaking, Yellen is a relatively friendly and neutral member of Biden’s economic team to China. In some previous issues, including cutting tariffs and negotiating some specific issues with China, Yellen was also the most active. Therefore, Yellen hopes to control Sino-US relations or Sino-US economic and trade cooperation in a controllable range during her term of office, and not to bring greater lethality to both sides indefinitely.
On the morning of January 18th, local time, Minister of Agriculture and Rural Affairs Tang Renjian (left) and US Secretary of Agriculture vilsack (right) co-chaired the seventh meeting of the China-US Joint Commission on Agriculture in Washington. Source: China Rural Agriculture Department
The meeting of China-US Joint Commission on Agriculture resumed "the United States breathed a sigh of relief"
Direct news from Shenzhen Satellite TV noted that since the beginning of the year, high-level exchanges between China and the United States have been frequent. On the morning of 18th, Chinese and American agriculture ministers co-chaired the seventh meeting of the China-US Joint Committee on Agriculture in Washington, D.C., to restart the Sino-US agricultural cooperation mechanism. The two sides had a frank and in-depth exchange of views on climate intelligent agriculture, food security, people-to-people exchanges and trade facilitation. Tang Renjian, Minister of Agriculture and Rural Affairs, said that on the 45th anniversary of the establishment of diplomatic relations between China and the United States, the agricultural departments of the two countries implemented the San Francisco Consensus between the Supreme Leader and President Biden, and resumed the meeting of the Joint Commission in Washington after nine years’ interruption, which was a milestone in the history of Sino-US agricultural relations.
In an interview with Shenzhen Satellite TV Direct News, Yang Shuiqing said that China and the United States have been tossing about trade disputes for so long, which has had a great impact on American agricultural products, especially the interest groups behind them. Therefore, the resumption of the meeting of the China-US Joint Commission on Agriculture in Washington, DC, which was interrupted for nine years, is more like a relief for the United States, because China is an important export market for the United States, and American agricultural products can continue to be sold to China in large quantities. In fact, the United States has now formed a relatively clear goal. For general consumer goods or agricultural products, it hopes to continue to maintain contacts with China. However, in the key field, that is, the so-called "small courtyard and high wall", it hopes to diversify with China, but the core is actually "decoupling".
Why do senior US officials talk about "competition" when Sino-US cooperation in various fields resumes?
Unlike China, which attaches more importance to the cooperation between China and the United States, the United States continues to talk about the competition between China and the United States while interacting with China. On the evening of 18th local time, the China General Chamber of Commerce held its annual gathering in new york. In a video speech from Beijing, US Ambassador to China Burns first affirmed that the relationship between the two countries had been "obviously stable" since the first meeting between the Chinese and American presidents in San Francisco, but he changed the subject and said that "there will always be a competitive relationship between the two countries". Burns continued to generalize the concept of national security, claiming that the United States would not "compromise" on national security issues, but as a supplement, he also stressed that it would not "decouple" from China.
Graham Allison, former assistant secretary of defense and founding dean of Harvard Kennedy School of Government, expressed concern about Sino-US competition. In a discussion at the annual meeting of the Davos Forum on the 19th, he said that the meeting between the Chinese and American presidents in San Francisco showed that there were obviously differences in Sino-American relations, but the Supreme Leader Chairman and President Biden would not let the misunderstanding worsen to the point that no one wanted to see. The two heads of state are well aware that the two most important countries in the world will become competitors, but it is still necessary to find ways to cooperate with each other.
Yang Shuiqing, an assistant researcher at the Institute of American Studies, China Academy of Social Sciences, observed that the United States hopes to maintain competition with China in key areas, and at the same time has a purpose of coexistence. Therefore, the United States has a very clear goal, that is, it seems that many areas are slowly recovering, but in the very core areas, it is actually monolithic and it is difficult to incite. Nevertheless, China is relatively sober and rational, and will cooperate in possible areas. In some key areas, China will also take the initiative to seek some allies outside the United States, not to say that it is either one or the other.
The author, Di Jing, is a direct journalist of Shenzhen Satellite TV. Jasmine Yi Dong is the direct news editor of Shenzhen Satellite TV.
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